John Trent (Sam Neill) is a successful insurance adjustor who always looks for the reasonable explanation in any situation. His powers of reason, however, become sorely tested when he is asked to find a successful horror writer, Sutter Cane (Jurgen Prochnow), who has mysteriously disappeared. He takes along Cane's editor Linda Styles (Julie Carmen). They find themselves in the fictional town of Hobb's End, one of the author's own horrific creations. Incidents of terror from Cane's book come to life. Trent believes that the bizarre happenings are a big joke until Linda is transformed into a monster before his eyes. Fact and fiction become a blur, and the lines between madness and sanity quickly disappear as Trent must persuade others of the horror he has witnessed. Although IN THE MOUTH OF MADNESS sounds like a Stephen King adaptation, it is an original screenplay. Only the most avid horror lovers will get their money's worth on this film.

In one sense, this movie does give an important moral: when biblical values and norms are given up, then everything becomes relative and sanity and madness have no meaning. Then, as the writer Cane believes, society will simply self-destruct since it has no sense of right and wrong. Unfortunately, this moral is mixed in with excessive violence and foul language. Particularly horrific is the crazy axe murderer killing three or four different people. In one scene, a group of mad people, all with axes, chop up a victim and eat pieces of his flesh. In another, a man is shot in the chest four times just before he kills someone with an axe. Blood gushes periodically and in large amounts, especially after one man commits suicide by shooting himself in the head. Besides merely human violence, there are demons that come to help in the violence. Cane wants believers in the "old spirits," presumably devils, which will come and cause mayhem. Cane creates an "anti-church" to help out here, complete with upside down crosses and a "New bible," his latest novel. The obscenities and profanities try to keep up with the gore. Nothing worth seeing in this maddening, meaningless movie.